Economics and Finance(English)
Bachelor	TR-NQF-HE: Level 6	QF-EHEA: First Cycle	EQF-LLL: Level 6

General course introduction information

Course Code:

FNCE315

Course Name:

Econometrics

Course Semester:

Fall

Course Credits:

Theoretical	Practical	Credit	ECTS
3	0	3	6

Language of instruction:

Course Requisites:

BBA179 - Business Mathematics | BBA181 - Business Mathematics | BBA 181 - Mathematics for Business | BBA182 - Applied Statistics

Does the Course Require Work Experience?:

Type of course:

Compulsory

Course Level:

Bachelor

TR-NQF-HE:6. Master`s Degree

QF-EHEA:First Cycle

EQF-LLL:6. Master`s Degree

Mode of Delivery:

Face to face

Course Coordinator :

Prof. Dr. MUSTAFA ERDİNÇ TELATAR

Course Lecturer(s):

Prof. Dr. MUSTAFA ERDİNÇ TELATAR

Course Assistants:

Course Objective and Content

Course Objectives:	• Specify a testable hypothesis regarding relationship among economic and financial variables using a linear regression model. • Estimate linear regression models and interpret the estimated coefficients. • Draw statistical inference about the relationship among variables.
Course Content:	Discussions will range from inferential statistics to econometric model building, estimation, and interpretation. Among topics covered are: the nature of regression analysis, classical linear regression models, model classification and estimation, interval estimation, hypothesis tests, and interpretation of estimated relationships.

Learning Outcomes

The students who have succeeded in this course;

Learning Outcomes

1 - Knowledge
Theoretical - Conceptual
1) • Identify the items in the balance of payments, current and capital accounts.
2) The purpose of this course is to equip students with an understanding of econometric analysis. Discussions will range from inferential statistics to econometric model building, estimation, and interpretation.
3) • Apply some of the basic models of international trade theory to evaluate and critically analyze real problems in international economics.
4) • Describe and interpret how different trade policies affect welfare and income distribution in an economy.
2 - Skills
Cognitive - Practical
3 - Competences
Communication and Social Competence
Learning Competence
Field Specific Competence
Competence to Work Independently and Take Responsibility

Lesson Plan

Week	Subject	Related Preparation
1)	• Introduction to the course • Review of the course syllabus content • Introduction and explanation of the course lessons • Methodology of econometrics • Overview of basic statistics and probability rules • Course syllabus content • Basics of statistics	reading
2)	• Statement of theory and hypotheses • Specification of a mathematical model • Estimation of a model • Hypothesis tests and forecasting with econometric models	reading
3)	• Statistical versus deterministic relationships • Regression versus causation • Regression versus correlation • Types of data for econometric analysis	reading
4)	• Stochastic disturbance term • Stochastic specification of population regression function • Sample regression function • Linear models, linearity in variables versus linearity in paramteres	none
5)	• The method of ordinary least squares (OLS) • Assumptions of OLS estimator • Properties of OLS estimator • The method of ML (maximum likelihood)	none
6)	• Probability distribution of disturbance terms • Variances of estimated parameters • Confidence interval estimates for regression parameters • Testing hypotheses about regression parameters	none
7)	• A multi-variable regression model • Interpretation of multiple regression coefficients • Meaning of partial regression coefficients • Estimation of partial regression coefficients	none
8)	• Midterm exam • Hypothesis tests about individual regression coefficients • Testing overall significance of estimated regression model • Testing restrictions on coefficient estimates	reading
9)	• Restricted least squares • Testing structural stability • Testing parameter stability • Likelihood ratio tests • Wald tests • Lagrange multiplier tests	reading
10)	• Deviations from OLS assumptions • Specification tests • The nature of multicollinearity • Detection of multicollinearity • Estimation in the presence of multicollinearity • Remedies for multicollinearity	Gujarati, pp 335-375
11)	• The nature of heteroskedasticity • Properties of OLS estimator under heteroskedasticity • Detection of heteroskedasticity • Remedies for multicollinearity • Robust standard errors • GLS estimator	Gujarati, pp 387-439
12)	• The nature of autocorrelation • Properties of OLS estimator under auto-correlated errors • Detection of autocorrelation • Remedies for autocorrelation • GLS estimator under autocorrelation	Gujarati, pp 441-487
13)	• Model specification and diagnostic tests • Types of specification errors • Omitted variable bias • Tests of specification errors • Model selection criteria	Gujarati, pp 506-517
14)	• Naive forecasts • Forecasts using historical trends • Forecasting using econometric models • Testing forecast accuracies	none
15)	• Final Exam	none

Sources

Course Notes / Textbooks:	Basic Econometrics, Fourth Edition Authors: Damodar N. Gujarati, 2003
References:	Basic Econometrics, Fourth Edition Authors: Damodar N. Gujarati, 2003 Introduction to Econometrics, 3rd Edition, Authors: James H. Stock and Mark W. Watson, 2010

Course-Program Learning Outcome Relationship

Learning Outcomes	1	1	2	3
Program Outcomes
1) Explain the advances in the area of economics and finance within the framework of scientific methodology, theories and models.
2) Employ the appropriate tools and analytical techniques to collect and analyze quantitative and qualitative data in the related areas, interpret results and propose solutions.
3) Explain the evolution of financial markets and institutions in a historical context and define how they operate.
4) Recognise the basic principles and regulations in the financial sector.
5) Discover and create entrepreneurial opportunities to successfully establish and develop their own ventures.
6) Recognise, interpret and discuss the current economic issues both at the national and global levels.
7) Have the English proficiency in following and interpreting the developments in the areas of economics and finance and in conducting written and oral communication.
8) Express the role of international capital markets in the global economy; accordingly define the concept of risk in terms of measurement and management.
9) Identify standards of personal, professional, social and business ethics, evaluate the ethical implications of various practices in the related areas, and be aware the importance of ethical behavior in adding value to the society.

Course - Learning Outcome Relationship

No Effect	1 Lowest	2 Low	3 Average	4 High	5 Highest

	Program Outcomes	Level of Contribution
1)	Explain the advances in the area of economics and finance within the framework of scientific methodology, theories and models.	5
2)	Employ the appropriate tools and analytical techniques to collect and analyze quantitative and qualitative data in the related areas, interpret results and propose solutions.	5
3)	Explain the evolution of financial markets and institutions in a historical context and define how they operate.	1
4)	Recognise the basic principles and regulations in the financial sector.	2
5)	Discover and create entrepreneurial opportunities to successfully establish and develop their own ventures.	2
6)	Recognise, interpret and discuss the current economic issues both at the national and global levels.	4
7)	Have the English proficiency in following and interpreting the developments in the areas of economics and finance and in conducting written and oral communication.	3
8)	Express the role of international capital markets in the global economy; accordingly define the concept of risk in terms of measurement and management.	2
9)	Identify standards of personal, professional, social and business ethics, evaluate the ethical implications of various practices in the related areas, and be aware the importance of ethical behavior in adding value to the society.	1

Learning Activity and Teaching Methods

Field Study
Lesson
Group study and homework
Reading
Homework

Assessment & Grading Methods and Criteria

Written Exam (Open-ended questions, multiple choice, true-false, matching, fill in the blanks, sequencing)
Homework
Observation

Assessment & Grading

Semester Requirements	Number of Activities	Level of Contribution
Midterms	1	% 40
Final	1	% 60
total		% 100
PERCENTAGE OF SEMESTER WORK		% 40
PERCENTAGE OF FINAL WORK		% 60
total		% 100

Workload and ECTS Credit Grading

Activities	Number of Activities	Workload
Course Hours	16	48
Study Hours Out of Class	16	64
Project	1	12
Homework Assignments	16	32
Midterms	2	16
Final	1	22
Total Workload		194